COMMISSIONER OF CUSTOMS, BANGALORE Vs. MAURYA EXPORT HOUSE

JUDGEMENT

(1.) REVENUE has filed this appeal against Order -in -Appeal No. 142/2004 -Cus., dated 16 -12 -2004 passed by the Commissioner of Customs (Appeals), Bangalore.

(2.) THE Respondents is a 100% EOU for the manufacture and export of ready -made garments and knitwears. They imported several raw materials free of duty under the 100% EOU scheme. Since 1995, the unit has been non -functioning. Goods covered by 110 bonds totally valued at Rs. 7,15,82,320/ - involving a Customs Duty of Rs. 9,21,60,949/ - are lying unutilized and the extension of warehousing period was not obtained in time. Therefore, proceedings were initiated by the Dy. Commissioner of Customs in Show Cause Notice dated 26 -9 -2002. The Development Commissioner taking into the account the relevant facts allowed the debonding of the unit in his order dated 26 -11 -2002. The Respondents requested the Customs Authorities for re -export of the materials. The Commissioner of Customs gave them extension of warehousing period till 12 -10 -2003. As the Respondents failed to comply in the sense they could not re -export the goods, the Dy. Commissioner issued a notice demanding a duty of Rs. 3,64,033/ - and Rs. 9,17,96,916/ - along with applicable interest. The reason for demanding duty is that the goods were treated to have been improperly removed from the warehouse within the provisions of Section 72(1)(b) of the Customs Act. An Order -in -Original No. 25/2004 dated 14 -9 -2004 was issued to the effect that in case of failure to comply with the demand of duty, the goods shall be sold for recovery of the said amounts. Against the above mentioned Order No. 25/2004, the Respondents approached the Commissioner (Appeals). The Commissioner (A) made the following observations in the Para 14 of the impugned order. 14. In view of what has been discussed herein above, I hold that since the appellants are in dire financial straits and have liabilities to the Department of Customs, the Bank and others, and are in no position to generate funds under the circumstances, but have stock of fabrics of approximately Rs. 7.0 crores in godown, it would be in the fitness of things and fair to consider re -leasing, may be only 30% to 40% of the stock of fabrics, free of all encumbrances, to the appellants and giving them an opportunity to sell in re -export to an appropriate buyer and clear their dues of the confirmed demand within a period of ninety days. The balance stock of fabrics of about 70% or so would continue to remain in the custody of the warehouse. It is highly probable that in the event of a distress sale through auction, the appellants might not even get a fair deal and will thus not be able to meet the creditors. Such a possibility is worth examining and may even require special dispensation and permission from the appropriate authorities at higher level and I suggest ought to be undertaken without loss of further time and taking everyone into picture. I, therefore, pass the following order. ORDER The OIO No. 25/2004 -Cus. Divn. Dated 14 -9 -2004 of the Asst. Commissioner of Customs, Customs Division, Bangalore is set aside and the case is remanded back to the same authority for reconsideration in toto and for passing an order as deemed fit within 15 days.

(3.) REVENUE is aggrieved over the impugned order on the following grounds.